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Auckland house prices have been rising since 2001. This is not peculiar to only Auckland, there has been a number of cities so affected.

This has been fuelled from three main drivers (a) low interest rates and (b) low housing stock relative to immigration and (c) a belief that somehow, it’s different this time.

The average salary of a two person household in Auckland, could be $100K, possibly slightly more, the average house price is now $1M. That is 10X your average salary. Given that interest rates are/have been at all time historical lows, an increase in interest rates could trigger massive losses and/or foreclosures.

It is a bubble, I’m curious as to how much further it can inflate.